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Apprenticeship Alabama aims to invest in workers

A new program approved this year by the Alabama Legislature aims to invest in the state’s top asset when it comes to recruiting new jobs and capital investment: its workers.

Apprenticeship Alabama, which will kick off in January, offers tax credits to participating companies that have qualified apprentices who receive classroom instruction and on-the-job training.

The Alabama Department of Commerce will manage the program, which will follow U.S. Department of Labor guidelines for apprenticeships. It will focus on five industry sectors, which are all targeted areas listed in the state’s strategic plan for growth, Accelerate Alabama:

Healthcare.

Construction and carpentry.

Information technology.

Distribution, transportation and logistics.

Advanced manufacturing and industrial maintenance.

Gov. Robert Bentley is joined by leaders as he holds the ceremonial signing of the Apprenticeship Tax Credit Act, sponsored by Sen. Arthur Orr, left, of Decatur. (Sydney A. Foster/Governor’s Office)

The idea for Apprenticeship Alabama came from state Sen. Arthur Orr, R-Decatur.

“The feedback I get when I talk to the employers we recruit is, ‘I came here for the people.’ Our No. 1 asset in Alabama is our people and their work ethic,” Orr said. “However, the world is changing, and we have to keep raising the bar on the skill set of our workers.”

A ‘win, win, win’

Advanced manufacturing is one of the key industries included in the new Apprenticeship Alabama program. (Honda Manufacturing of Alabama)

The reality is that a lot of people simply can’t afford to leave their paying jobs and go sit in a classroom, Orr said. Larger companies sometimes foot the bill for this kind of training, but smaller companies often cannot. And for people who are single parents, night or weekend classes aren’t an option, either.

“The question becomes,” Orr continued, “‘How do we keep them working on the job but also allow them to get additional credentials or certificates that would increase their earning power?”

Orr said he and Ed Castile, deputy secretary of the Alabama Department of Commerce and director of the worker training agency AIDT, researched a similar program in South Carolina. Organizers there have been pleased with the results and said the tax credit provided an incentive for employers to participate.

“Ultimately the hope is for the workforce to receive additional training and improvement, helping workers increase their wage capacity and how they provide for their families. Hopefully it’s a win, win, win for employers, employees and families,” Orr said.

AIDT director Ed Castile (Made in Alabama)

Castile said Alabama faces shortages in skilled trade workers, just like other states.

Apprenticeships involve intense, multiyear training. And while they have been around for years, Alabama has never focused on them as a state program until now.

“We believe this particular model will assist us in getting ahead of this problem and getting people already in the workforce moved up to a higher skill level,” Castile said.

Under the plan approved by the Legislature, participating companies will receive a $1,000 income tax credit through the Alabama Department of Revenue for each apprentice in training, up to five per year.

The apprentices must be part of the U.S. Department of Labor’s registered apprenticeship program, which has strict requirements on the curriculum for classroom training, as well as weekly hours of on-the-job training.

‘Investing in our people’

Castile said all companies across all industries are looking for a dependable, highly skilled workforce.

“We have a lot of great companies now, and they continue to grow and expand. We want to get ahead of this issue, so when an employer is looking for those people we can say, ‘Here is the answer to that in the state of Alabama,’” he said.

Greg Canfield, secretary of the Alabama Department of Commerce, said Alabama workers are responsible for the state’s greatest economic development successes.

“World-class companies have put down roots here, and they have flourished because of the drive, determination and skill of their workforce,” he said. “We must keep investing in our people so those success stories can continue.”